Anglo American spruces up assets it wants to sell

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What do you do if you're trying to sell a mine and want to get the highest price possible?

Well, it's very much like trying to sell your house – you use your capital to make it look better. And that's exactly what Anglo American Plc is trying to do with some of its Chilean copper mines and smelter.

The London-based mining giant is busy sprucing up Mantoverde and Mantos Blancos, two of the three copper mines it wants to sell. Both mines have declined in production over the past five years.

For Mantoverde, Anglo is working on showing the breadth of the copper resource, according to people familiar with the matter. For Mantos Blancos, where operating costs have increased, Anglo is trying to show that this has been fixed, said the sources.

The company intends to "maximize value" of the mines, said one of the sources.

Anglo is also planning on selling the El Sodado copper mine and the Chagres smelter, which it jointly owns with Codelco and Mitsubishi. The miner, which holds the controlling stake, is currently discussing the sale with its partners.

The talks, along with the additional work at Mantoverde and Mantos Blancos, will delay the official start of the sale, sources said, and added that Morgan Stanley and Goldman Sachs have been hired to sell the assets.

Anglo, like other mammoth mining companies, is aggressively streamlining its business amid lower metal and mineral prices.

The miner has said it plans to sell its stake in construction company Lafarge Tarmac Holdings Ltd., as well as some of its platinum assets. The company has not announced the other assets it wants to divest.

"We have defined the optimal structure for our portfolio of copper assets and are now going to explore in more detail the potential divestment of our smaller copper assets in Chile," said an Anglo spokesman. "We may decide to pursue these divestments at the right time and to deliver the optimal outcome for our shareholders."

There has been great interest in copper assets this year, even with the price of the red metal weakening. Glencore Plc sold its Peruvian copper project to Chinese investors for $6-billion and Freeport-McMoRan Inc. sold one of its Chilean copper mines to Canada's Lundin Mining Corp for nearly $2-billion.